What causes such high prices at McGhee Tyson Airport?

What causes such high prices at McGhee Tyson Airport?

Updated:

By MONA NAIR
6 News Reporter

ALCOA (WATE) - Knoxville's McGhee Tyson ranks among the most expensive airports in the nation. Could that ever change?

If you've paid for a ticket in or out of McGhee Tyson, you may agree with passengers like Anne Parks. "Well I think they're a little higher than some of the surrounding airports, but if you want to travel you either have to go out of town or pay the price," she said.

To give you an idea of how pricey Knoxville is, compare fares to Washington D.C. from Knoxville, which hover around $700, to prices to D.C. from Chattanooga. Those are in the $200 range.

"There's just no low fare competition going to and from Washington, D.C. and the airlines know that," said Jim Evans, vice president of marketing and air service development at McGhee Tyson.

2011 was a year with a lot of changes at McGhee Tyson. In March, Vision Airlines started service in Knoxville. In August, the airline pulled out saying it was financially unrealistic to operate here.

In the summer, Frontier Airlines began operating in Knoxville.

In the fall, AirTran Airways announced it was leaving.

The comings and goings of these low fare carriers make all the difference in what you pay for a ticket.

"Without low fare competition, generally airfare from the other competition tends to rise because they don't have any reason to keep the airfares low," Evans explained.

Currently, Allegiant Air and Frontier Airlines are the only two low cost carriers with plans to stay in Knoxville.

Experts say keeping them here is also the key to keeping prices from going any higher at McGhee Tyson.

"Right now with Frontier, there are a lot of empty seats to Denver. The community needs to recognize that if this continues, we'll have a hard time keeping Frontier in our airport," Evans said.

The impact of even a single airline coming or going is tremendous. For example, Knoxville has ranked for some time among the top 10 most expensive airports in the nation. That was until very recently when it dropped to #12 on the list compiled by the Bureau of Transportation Statistics.

"Now we're down to 12 and the reason for that is Frontier Airlines introducing their lower fares," says Danni Varlan, director of East Tennesseans for Airfare Competition.

Varlan works on bringing low fare carriers to our area. She says attracting them is an uphill battle that boils down to the kind of money a community is willing to offer.

"And if you look at the cities they are announcing, they are very comparable to us in terms of size and service. But some of them have millions of dollars. Wichita, Kansas is a good example. The state of Kansas gives them millions of dollars every year," Varlan said.

If we can't come up with the cash, ultimately ticket prices stay high. "It's been nearly impossible to get businesses to step up, to get the city to step up. Nobody wants to support it financially," Varlan explained.

But the high prices also have to do with simple economics. Airlines are looking to make a profit wherever they can.

For example, remember those low fares from Chattanooga to D.C. and high fares from Knoxville to D.C.? "The demand for travel from here to Washington is huge because we have a national lab and that is where they go," Varlan said.

In that sector, no competition and very high demand make Knoxville a magnet for exorbitant prices.  "The demand is so high, they can demand higher fares. In Chattanooga, the fares are lower because they are trying to get people on the plane," Varlan said.

So in some cases, the best solution may be to find those lower demand airports close by. But that choice will have its consequences in Knoxville, like with Frontier's empty flights.

"They (Frontier) will take their airplanes and leave. And as soon as they do, airfares will be right back to where they were," Evans said.

Realistically though, it could take years to see flights into Knoxville become more affordable.

Another big factor is the crisis airlines are going through nationally. The rising price of fuel has made all airlines extremely cautious about whether to enter a new destination.

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